Joint meeting highlights next steps for economic development district

ESCANABA – Now that an economic development district in the Central Upper Peninsula is a state law, an application must be submitted for Delta and Marquette counties to become such a district.

“It’s going to be a challenge,” commented Escanaba City Manager Jim O’Toole at Wednesday’s monthly joint governmental session at city hall.

Various representatives – including state, county, township, and city officials – were updated on the process necessary to create an economic development district in the two counties as recently authorized by state law.

Last month, legislators and the governor agreed to amend Public Act 275 to include a sixth Next Michigan Development Corporation in Delta and Marquette counties. Five districts exist downstate and are eligible for state funding and tax incentives.

The two counties must apply for the special designation and have the application approved before the resulting corporation can take advantage of tax cuts and state funding aimed to encourage investment, job creation, job retention, and related economic growth.

“We have an opportunity to apply for a Next Michigan to create a development corporation to advance projects on a regional basis,” said O’Toole.

O’Toole noted it’s like starting a new company involving entities in both Delta and Marquette counties. Each participant can contribute its own talents and skills to share with the other participants with the goal of economic development for the corporation.

“We don’t want to compete with each other. We want to cooperate with each other,” said O’Toole, adding some municipalities and agencies may decide not to participate in the economic development district.

Those attending Wednesday’s meeting were informed of what has to be done in the application process. Kevin Korpi – a consultant hired by Escanaba in January 2011 to try to designate its north shore as an economic development district – outlined the steps in a teleconference call from Lansing.

Korpi said all the partners need to work collaboratively and build upon the good work that’s already been done in Delta and Marquette counties.

The first step of the application process will be an analysis of the district including an economic impact study of the region, a district map, and a list of local governmental units, he said.

Step two will be an inter-local agreement which Korpi described as “a critical legal step” in the application process.

Step three would identify what a district board would look like and who would serve, he said.

Step four would be a proposed budget for the corporation, he said.

Once these steps are made, the application could be completed with the assistance of the Michigan Economic Development Corporation (MEDC) which oversees the districts.

Lois Ellis, MEDC business development manager for the U.P., attended Wednesday’s meeting. She said the MEDC will help with the application process and can also offer various economic incentives following the application’s approval.

Incentives for economic growth include creating a Renaissance Zone for tax abatements, improving multi-mobile transportation commerce, establishing a local development financing tax such as tax increment financing also known as TIF, and seeking personal property tax abatements and industrial facilities tax exemptions.

Ellis added the MEDC offers other tools for business development based on job creation and investment.

As businesses develop, the MEDC can help companies grow with the Economic Gardening Program by providing research and guidance to seek new products, services or markets, explained Ellis. Eight companies in Delta County have used this program, she said.

The Pure Michigan Business Connect Program can also help established businesses network with other businesses as well as match companies to the needs and services of other companies, she added.

Delta County Economic Development Alliance Director Vicki Schwab praised Delta and Marquette counties for working together towards a sixth Next Michigan Development Corporation, describing the district as one of the most powerful economic tools in the state.

“This shows the world what a great example we are in the Central U.P.,” she commented, confirming the local EDA’s support for the economic development district.

Last spring, Sen. Tom Casperson (R-Escanaba) sponsored a bill in the Senate for the Michigan Economic Development Corporation to add the sixth district in the U.P. A similar bill was sponsored in the House by Rep. John Kivela (D-Marquette).

A Senate hearing on the legislation was held in Escanaba in August. Legislators passed the bills in early December. Governor Rick Snyder signed the legislation into law on Dec. 21, officially authorizing Public Act 238 and Public Act 239 which went into effect on Dec. 26.